effective rate of interest
Definition
Actual interest paid on a loan, or earned on a deposit account, depending on the frequency of compounding or effect of inflation. It is different from the nominal rate of interest which ignores compounding and other factors.
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effective rate of interest is in the Accounting & Auditing, Banking, Commerce & Finance and Investing subjects.
effective rate of interest appears in the definitions of the following terms: internal rate of return (IRR), effective interest rate and nominal rate of interest
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